- AUD/USD wavers around multi-month high, marks an easy move after posting the biggest gains in five weeks.
- US FDA experts voted in favor of Pfizer’s covid vaccine, official approval awaited before the usage.
- Tiring talks over US stimulus, Brexit battle worsening virus conditions in the US.
- A lack of major data highlights risk catalysts for fresh impulse.
Having surged to the highest since June 2018, AUD/USD trades in a choppy range between 0.7541 and 0.7531 during the initial Asian session on Friday. The pair marked the heaviest run-up the previous day amid broad US dollar selling and mixed risk signals.
Does vaccine optimism fade?
Although the US Food and Drug Administration (FDA) experts voted in favor of the usage of Pfizer-BioNTech coronavirus (COVID-19) vaccine, the market players’ reaction is minimal as the news seems mostly priced in. Even so, S&P 500 Futures print mild gains following the news.
On Thursday, the global risk tone dwindled amid extended talks over the US covid stimulus and no positive on the Brexit side. The American Congress members are jostling over the details of the aid package. On the other hand, the UK starts preparing for no-deal Brexit even as the European Union (EU) is yet to have a final word on the future of the Brexit talks, about to roll out by Sunday. Elsewhere, the US continues to wrangle with the virus while downbeat data and the ECB’s stimulus exert additional pressure on the US dollar index (DXY).
It’s worth mentioning that the Aussie-China tussle keeps trying to disappoint the AUD/USD bulls, but fail. Recently, China announced anti-subsidy measures on the imports of Australian wine.
Looking forward, risk news concerning the US stimulus, virus vaccine and Brexit, not to forget headlines from China, can keep the driver’s seat ahead of the US session.
Overbought RSI conditions warrant bulls to revisit the 0.7500 round-figure but any further downside will be challenged by the August high near 0.7415. Meanwhile, the pair’s extended upside eyes June 2018 high of 0.7677.
Credit: FX Street